Category: Volume 7

by Greg Reilly, Chicago-Kent College of Law

from Volume 7 (2017-2018)

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Abstract: The patent system is in flux. Concerns abound about the imperfect fit between traditional patent rights and the Information Age, excessive numbers of patents, overbroad patent rights, poor patent quality, and allegedly exploitative actors, like so-called “patent trolls.” In response, courts, commentators, and Congress have proposed, debated, and sometimes adopted a series of reforms and changes to patent rights, patent doctrines, and patent institutions. The America Invents Act of 2011 (AIA) introduced the most significant changes to the patent system since 1952 and was even described by one commentator (hyperbolically, as we will see) as “the most significant overhaul to our patent system since the founding fathers first conceived of codifying a grand bargain between society and invention.” The Supreme Court’s recent renewed interest in patent law has also resulted in significant changes, including abolishing the long-standing rule that “a patent owner is entitled to permanent injunctive relief once a patent is adjudicated to be both valid and infringed.” And scholars have proposed a variety of other significant changes to American patent law.

With change, comes opposition. The changes and proposed changes to patent law have sparked vigorous policy debates about the effects on the patent system’s goals of promoting innovation and preserving competition. But beyond policy disagreement, opponents also are concerned that recent changes and proposed changes reflect a sharp, dramatic break with long-standing, fundamental aspects of the patent system. To them, departing from the historical features of the patent system is inadvisable, illegitimate, or even unconstitutional.

This Essay provides context necessary to evaluate these concerns. Recent changes and proposed changes seem like a dramatic and sharp break with past practice precisely because the patent system has been remarkably stable since the middle of the 19th century. To many in the patent community, this contention may seem surprising, or even laughable, given widespread recognition of significant adjustments and fluctuations in the patent system over the years. The patent system certainly undergoes doctrinal variations at the operational level of applying patent law’s specific requirements to determine if particular patents are valid and infringed—for example, the specific tests used or defenses available. There also have been changes in how the patent system is used over time, including the volume of patenting and patent enforcement activity.

But at a foundational or systemic level, the nature of the rights granted, the institutional structure of the patent system, and the basic doctrines of patentability, infringement, and remedies have remained largely constant. It is exactly because the foundational and systemic aspects of the patent system have been so constant that the fluctuations in doctrinal implementation seem so significant. For example, the proper test for determining whether an invention is too obvious to warrant a patent, much debated in the patent community, would seem relatively minor compared to a reform requiring the Patent Office to decide whether to issue a patent based on a case-by-case determination of whether the innovation benefits of a particular patent outweigh its social costs. Even the question of when inventions are patent ineligible abstract ideas, laws of nature, or natural phenomena—probably the most contested current patent issue—would become much less significant if Congress started debating abolishing patents for some industries, imposing price controls on patented products, setting mandatory licensing terms, or replacing the private right of action for patent infringement with government enforcement.

But long-standing stability in the foundational and systemic characteristics of the patent system does not mean that these characteristics are inevitable, necessary, or mandatory features. To the contrary, in the first few decades of the American patent system, there was significant change, experimentation, and development in the nature of patent rights, the patent system’s institutional structure, and the basic doctrines of patent law. The foundational and systemic aspects of the patent system that persist today emerged by the middle fifty years of the 19th century (1825–1875). Thus, the characteristics of our modern patent system reflect less the influence of the Framers or of the 18th century than they do the influence of the early to middle of the 19th century.

After establishing our 19th century patent system in Part I, Part II describes the consequences that our 19th century patent system has for present policy debates over patent law. A brief conclusion follows.

by Stephen Yelderman, Notre Dame Law School

from Volume 7 (2017-2018)

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Abstract: The exclusive rights of a U.S. patent are limited in two important ways. First, a patent has a technical scope—only the products and methods set out in the patent’s claims may constitute infringement. Second, a patent has a geographic scope—making, using, or selling the products or methods described in the patent’s claims will only constitute infringement if that activity takes place in the United States. These boundaries are foundational features of the patent system: there can be no liability for U.S. patent infringement without an act that falls within both the technical and geographic scope of the patent.

Once liability has been established and a court’s attention turns to remedies, the continued relevance of these boundaries is not so clear. If all the infringing activity and all the resulting harm are within the technical and geographic scope of the patent, there is no problem. But, sometimes, activities within the technical and geographic scope of a patent cause harm to the patentee somewhere outside that scope. For example, a defendant’s infringing sales of a patented product may cause the patent holder to lose some sales of an unpatented product too. Or, as another example, a defendant’s infringing activity in the United States might cause a patent holder to lose sales somewhere else. Are these harms—to sales of a different product, or in a different country—cognizable for purposes of measuring the patent holder’s damages? Or do the basic limits on patent scope apply to questions of remedy just as they do to questions of liability?

The Federal Circuit has resolved this puzzle differently depending on which boundary is at issue. When it comes to technical scope, the Federal Circuit has long held that patent holders may recover for all the harms actually and proximately caused by the infringement. As a result, if the defendant’s infringing actions divert sales from the patent holder, the patent holder can potentially recover all of those lost sales, whether or not they fall inside or outside the technical scope of the patent at issue.

When it comes to harms beyond a patent’s geographic scope, however, the Federal Circuit has taken a different approach. In a series of recent cases, the court has developed a hard-and-fast geographic limit, categorically denying recovery of any foreign losses that were caused by the domestic infringement. As a result, if infringing activity inside the United States causes lost sales outside the United States, those losses are simply left to lie where they fall—even if they were actually and proximately caused by the infringing act.

Under the Federal Circuit’s current approach, then, the technical scope of a patent is applied only once in a patent case—to determine whether the defendant can be held liable as an infringer. In contrast, the geographic scope of a patent does a kind of double duty, applying first to the question of liability, and a second time to the question of damages.

This Essay argues that the same approach adopted at the edge of technical scope should apply at the geographic boundary as well. Specifically, patent holders should recover for the injuries actually and proximately caused by domestic acts of infringement, even if those injuries arise outside the technical or geographic scope of the patent. The Federal Circuit has correctly decided cases in which damages fall across the line of technical scope, but erred when it comes to damages that happen to cross a geographic boundary.

by Jacob S. Sherkow, New York Law School &
Jorge L. Contreras, S.J. Quinney College of Law, University of Utah

from Volume 7 (2017-2018)

Download this Article in PDF format from The Jerome Hall Law Library’s Digital Repository.

Abstract: The fruits of the biotechnology revolution are beginning to be harvested. Recent regulatory approvals of a variety of advanced therapies—Keytruda (pembrolizumab), Kymriah (tisagenlecleucel), and patisiran—have ushered in an age of “precision medicine” treatments that target patients’ specific genetic, physiological, and environmental profiles rather than generalized diagnoses of disease. Therapies like these may soon be supplemented by gene editing technologies such as CRISPR, which could enable the targeted eradication of deleterious genetic variants to improve human health. But the intellectual property (IP) surrounding precision therapies and their foundational technology remain controversial. Precision therapies ultimately rely—and are roughly congruent with—basic scientific information developed in the service of academic research. Much of precision medicine’s IP, however, is held by academic research institutions that employ for-profit surrogate companies, companies responsible both for commercially developing university research and sublicensing university IP to others. This creates an uneasy tension between the public missions of universities and the commercial motives of surrogates, particularly universities’ goals of producing and disclosing scientific information, and surrogates’ goals of exploiting that information for commercial gain.

This essay examines the challenges that surrogate licensing poses for the future of precision medicine. It begins by providing a brief summary of precision medicine and its recent developments. Next, it provides an overview of university patenting and the shift toward surrogate licensing. It then explores some of the difficulties concerning surrogate licensing in the context of precision medicine and, later, suggests modified licensing approaches and best practices that may better promote scientific discovery, the development of human therapies, and overall social welfare. Lastly, the essay discusses some larger doctrinal and theoretical implications arising from surrogate licensing in informationally intensive fields, like precision medicine.

by Arpan Banerjee, Jindal Global Law School in Delhi, India

from Volume 7 (2017-2018)

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Abstract: In September 2014, a few months after a landslide election victory, the Indian Prime Minister Narendra Modi announced the launch of “Make in India,” an ambitious program designed to turn India into a global manufacturing hub. One of the factors widely thought to be responsible for Modi’s victory was support from India’s “neo-middle class”—a young, newly- urbanized section of the electorate seeking employment and improved living standards but struggling amidst an economic downturn. In a speech inaugurating Make in India, Modi linked the program with the aspirations of this section of society. Modi stated the need to elevate the status of the poor-to-middle class as fast as possible, noting that sixty-five percent of India’s population was aged thirty-five and below. He declared that the “[s]traight answer” to achieve this goal would be to create jobs in the manufacturing sector. He emphasized the importance of Foreign Direct Investment (FDI) for this purpose, terming FDI as both a “responsibility” and an “opportunity.” But Modi conceded that India’s poor rank in the World Bank’s Ease of Doing Business Index—below 130 at the time—was an impediment and had to ideally rise to fifty. Modi thus announced that the government would reduce bureaucratic obstacles faced by investors This has been a key focus of the initiative, and various measures have since been adopted. Make in India was followed by the launch of two complementary schemes in 2015 and 2016 respectively: “Digital India” and “Start Up India.” The stated aim of the former is to transfer India into a “digitally empowered society and knowledge economy,” with one of its pillars being the promotion of manufacturing in the electronics sector. The stated aim of the latter includes “fostering entrepreneurship and promoting innovation.”

Make in India and its allied schemes have yielded some dividends, and India’s rank in the Ease of Doing Business Index recently jumped to 100. Yet various challenges to Make in India exist. Crucially, automation technologies, such as 3D printing, threaten to displace millions of low-skilled jobs. As automation is seen as less of a threat in displacing jobs in electronics manufacturing, there is a case for arguing that a strong focus of Make in India should be the manufacture of electronic products like smartphones, tablets and semiconductors. Although India’s electronics industry is growing at a rapid rate, the industry is heavily reliant on foreign imports—a further reason to prioritize the area within Make in India. However, India suffers from low technological preparedness and weak ICT infrastructure. If India is to make improvements on this front, issues involving innovation and intellectual property (IP), such as technology transfer and licensing, are likely to assume much importance. In this regard, Make in India has identified IP as a key policy component, Digital India has included “IP generation in the area of electronics” as an objective, and Startup India has included the commercialization of IP in its agenda. But none of the parameters in the Ease of Doing Business Index factor in the role of IP. Thus, linking the success of Make in India with the Ease of Doing Business Index may neither capture the concerns of foreign investors heavily reliant on IP protection, nor reflect advancements in India’s IP system.